Denver is projected to lose about $10.6 million in revenue in 2013 from uncollected Internet sales taxes, according to a study by Englewood-based IHS Global Insight.

IHS conducted the study, released in May, for the United States Conference of Mayors, the National Association of Counties and the National League of Cities.

The study ranks Denver at the bottom of a list of eleven cities projected to lose more than $10 million in 2013. New York ranked the highest on the list with an estimated loss of $235.1 million.

While the numbers are new, the fact that Denver is losing revenue is not. States and the federal government, as well as other studies, have acknowledged revenue loss from Internet purchases.

A recent study conducted at the University of Tennessee estimated that Colorado and local governments lost out on $172.7 million in revenue from uncollected taxes on Internet sales.

The reason states are having a difficult time collecting revenue from Internet sales is due to the makeup of current law. Right now, businesses are not required to collect taxes on a sale made in a state unless they have a nexus, or physical presence, in that state. While customers are supposed to report taxes on every purchase they make, many people don’t or are unaware that they have to.

In May, the U.S. Senate passed a bill, dubbed the Marketplace Fairness Act, which would allow states to collect taxes on Internet sales. In order to do so, however, the law requires states to simplify their tax base, create a singular entity to collect taxes on Internet sales and provide free software to retailers that calculates sales tax amounts.

Within the same month, Gov. John Hickenlooper signed a measure that places Colorado in position to comply with the federal law. The state law is set to go into effect July 1, 2014, but only if the federal bill becomes law by Dec. 31.

If Colorado began collecting on those taxes, the state would recoup more than $70 million a year of lost revenue, according to legislative staff estimates provided with the state law. Local governments would receive the remainder.

Implementing the law would cost the state about $2.5 million the first year, but significantly decline in subsequent years.